Trump’s 25% tariffs against Mexico and Canada now in effect

President Donald Trump’s long-threatened 25% tariffs against Canada and Mexico went into effect on Tuesday. Economists warn the tax on goods could be harmful to the U.S. and its trade partners.

The measure was set to be enacted a month ago but was pushed back, as Trump warned neighboring countries to crack down on drug trafficking and illegal immigration — without laying out any specific guidance. Meanwhile, legislation in Washington has given an April deadline for agencies to review trade policies.

Dr. Rob Gillezeau, an assistant professor of economic analysis and policy at the University of Toronto in Canada, told WDET tariffs have the potential to be especially damaging to the auto industry, where parts can cross the border several times during the manufacturing process.

“The Big Three are going to be decimated,” he said. “This feels like a perfectly designed policy by the president to do as much harm to Ontario, and to Michigan, as one could imagine.”

Of the roughly $50 billion in goods that enter Michigan from Canada each year, about 55% is tied to the transportation sector, according to the Canadian Consulate General in Detroit. Gillezeau said the tariffs have the potential to cast the Canadian economy into a recession.

“I suspect it won’t be as deep as the bottom of COVID,” Gillezeau said. “It won’t be as deep as the Great Depression, fingers crossed. It will likely be deeper than every other recession that has happened to the country.”

Ontario Premier Doug Ford has threatened to turn off electricity exports from Ontario in response to the tariffs, among other steps.

Listen: Canadian economics professor discusses impacts of tariffs on US-Canada relations

Related:

• What are tariffs? And how could they affect consumers?
• Michigan Congresswoman says tariffs on Canadian and Mexican products could crash U.S. auto industry
• Experts: Effect of tariffs on Michigan economy will depend on details